Budget cuts likely after failure of Oklahoma revenue bill

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OKLAHOMA CITY (AP) — Oklahoma legislative leaders indicated Tuesday they have no plans to pursue new revenue-raising proposals following the failure of a bill that included a $5,000 teacher pay raise, and that another round of budget cuts is likely.

The House voted 63-35 on the bill late Monday, falling 13 votes short of the three-quarters majority needed to pass a revenue-raising measure in the chamber. Republican House Speaker Charles McCall said the measure, a $581 million package of proposed tax hikes supported by a coalition of Oklahoma business and civic leaders, was the only revenue package being considered in the Legislature.

McCall’s statements were echoed Tuesday by the Republican leader of the state Senate and a spokesman for GOP Gov. Mary Fallin, who said they will concentrate their efforts on balancing the budget for the fiscal year that ends June 30 with whatever funds are available.

“As the governor and House leadership said repeatedly, that was the only chance at securing new revenue to pay for a teacher pay raise and stabilize our budget,” Senate President Pro Tem Mike Schulz said in a statement.

House Majority Floor leader Jon Echols said “significant cuts” of up to $100 million are likely to state agency budgets during the final three months of the current fiscal year.

“We are now looking at which agencies to cut,” Echols said. “We’ll move forward in that process.”

The Oklahoma Supreme Court ruled last year that a $1.50 per pack cigarette fee approved by the Legislature was unconstitutional, creating a $215 million hole in the current state budget. The ruling left the Department of Mental Health and Substance Abuse Services, the Oklahoma Health Care Authority and the Department of Human Services without enough money to make it to the end of the fiscal year.

The revenue-raising plan that failed Monday included a new $1.50 hike on a pack of cigarettes, plus a 6-cent increase in the tax on gasoline and diesel fuel and an increase in the gross production tax on oil and natural gas from 2 percent to 4 percent. But Democrats who opposed the proposal said it would have disproportionately raised taxes on low- and middle-income Oklahomans.

Alicia Priest, president of Oklahoma Education Association, said she is disappointed in the outcome of the vote and encouraged lawmakers to keep trying to approve a pay raise for the state’s teachers, who have not had a pay increase in 10 years. Oklahoma is ranked 49th in the nation in teacher pay.

“Today our members are back at school doing their job and they expect nothing less of our legislators,” Priest said. “If there’s a better plan, I expect to see it soon.”

Priest said the organization’s nearly 40,000 members expect state lawmakers to put aside partisan politics and gamesmanship that she says prevented passage of the revenue-raising bill in the House.

“We are not on a sustainable course and we’ve got to make a turn somewhere,” Priest said. “The reality is we’re going to have to raise revenue. Somewhere along the line we all have to pay our part to fund core government services.”